The numbers: Builder confidence in the market for newly built single-family homes rose two points to a level of 70 in May, according to the National Association of Home Builders/Wells Fargo housing market index released Tuesday.

The Econoday-compiled consensus was for a 69 reading.

April’s reading has downwardly revised a point to 68. Any number over 50 indicates that more builders view conditions as good than poor.

What happened: The component for current sales conditions rose while those for buyer traffic and expectations in the next six months were unchanged.

The big picture: Builders are confident, at a time of low unemployment, a shortage of housing inventory and fairly low mortgage rates.

Rising lumber and labor prices remain a concern, however.

What they’re saying: “The solid May report shows that builders are buoyed by growing consumer demand for single-family homes,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “However, the record-high cost of lumber is hurting builders’ bottom lines and making it more difficult to produce competitively priced houses for newcomers to the market.”

Courtesy of marketwatch.com and credit to Steve

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